84082 Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 

most recently harvested crop at that 

time. 

(4) Only handlers, including duly 

authorized officers or employees of 

handlers, who are eligible to serve as 

handler members of the Board shall 

participate in the nomination of handler 

members and alternate handler 

members of the Board. No handler shall 

participate in the selection of nominees 

in more than one district during any 

nomination cycle. If a handler handles 

cherries in more than one district, that 

handler may select in which district he 

or she wishes to participate in the 

nominations and election process and 

shall notify the Secretary or the Board 

of such selection. A handler may not 

participate in the nominations process 

in one district and the elections process 

in a second district in the same election 

cycle. If a person is a grower and a 

grower-handler only because some or all 

of his or her cherries were custom 

packed, but he or she does not own or 

lease and operate a processing facility, 

such person may vote only as a grower. 

For the duration of a handler’s term on 

the Board, the sales constituency 

affiliation for said handler will be the 

affiliation at the time of nomination. 

* * * * * 

(7) After the appointment of the initial 

Board, the Secretary or the Board shall 

announce at least 180 days in advance 

when a Board member’s term is expiring 

and shall solicit nominations for that 

position in the manner described in this 

section. Nominations for such position 

should be submitted to the Secretary or 

the Board not less than 60 days prior to 

the expiration of such term. 

(c) * * * 

(3) * * * 

(i) * * * 

(ii) To be seated as a handler 

representative in any district, the 

successful candidate must receive the 

support of handler(s) that handled a 

combined total of no less than five 

percent (5%) of the previous three-year 

average production handled in the 

district; Provided, that this paragraph 

shall not apply if its application would 

result in a sales constituency conflict as 

provided in § 930.20(i). 

* * * * * 

■ 5. Revise § 930.28 to read as follows: 

§ 930.28 Alternate members. 

(a) An alternate member of the Board, 

during the absence of the member for 

whom that member serves as an 

alternate, shall act in the place and 

stead of such member and perform such 

other duties as assigned. However, if a 

member is in attendance at a meeting of 

the Board, an alternate member may not 

act in the place and stead of such 

member. In the event a member and his 

or her alternate are absent from a 

meeting of the Board, such member may 

designate, in writing and prior to the 

meeting, another alternate to act in his 

or her place: Provided, that such 

alternate represents the same group 

(grower or handler) as the member and 

is not from the same sales constituency 

as another acting member or acting 

alternate member in that district. In the 

event of the death, removal, resignation 

or disqualification of a member, the 

alternate shall act for the member until 

a successor is appointed and has 

qualified. 

(b) Alternate members may be from 

the same sales constituency as the 

member for whom they serve as an 

alternate. In the event a member and his 

or her alternate are absent from a 

meeting of the Board, another alternate 

may act for the member following the 

requirements of § 930.28(a), provided 

this does not create a sales constituency 

conflict with the other members of that 

district. 

(c) The Board, with the approval of 

the Secretary, may establish rules and 

regulations necessary and incidental to 

the administration of this section. 

■ 6. Amend § 930.52 by revising 

paragraphs (a) and (d) to read as follows: 

§ 930.52 Establishment of districts subject 

to volume regulations. 

(a) The districts in which handlers 

shall be subject to any volume 

regulations implemented in accordance 

with this part shall be those districts in 

which the average annual production of 

cherries over the prior 5 years has 

exceeded 6 million pounds. Handlers 

shall become subject to volume 

regulation implemented in accordance 

with this part in the crop year that 

follows any 5-year period in which the 

6-million-pound average production 

requirement is exceeded in that district. 

* * * * * 

(d) Any district producing a crop 

which is less than 50 percent of the 

average annual production in that 

district in the previous 5 years would be 

exempt from any volume regulation if, 

in that year, a restricted percentage is 

established. 

* * * * * 

■ 7. Amend § 930.62 by revising the 

introductory text of paragraph (a) to 

read as follows: 

§ 930.62 Exempt uses. 

(a) The Board, with the approval of 

the Secretary, may exempt from the 

provisions of §§ 930.41, 930.44, 930.51, 

930.53, or 930.55 through 930.57 

cherries for designated uses. Such uses 

may include, but are not limited to: 

* * * * * 

Erin Morris, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2023–26396 Filed 12–1–23; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF ENERGY 

10 CFR Chapter III 

RIN 1901–ZA02 

Interpretation of Foreign Entity of 

Concern 

AGENCY: Office of Manufacturing and 

Energy Supply Chains (MESC), U.S. 

Department of Energy. 

ACTION: Notification of proposed 

interpretive rule; request for comments. 

SUMMARY: The U.S. Department of 

Energy (DOE or the Department) 

provides this notification of proposed 

interpretive rule and request for public 

comment on its interpretation of the 

statutory definition of ‘‘foreign entity of 

concern’’ (FEOC) in the Infrastructure 

Investment and Jobs Act, also known as 

the Bipartisan Infrastructure Law (BIL). 

This statutory definition provides that, 

among other criteria, a foreign entity is 

a FEOC if it is ‘‘owned by, controlled by, 

or subject to the jurisdiction or direction 

of a government of a foreign country 

that is a covered nation.’’ In this 

document, DOE proposes to clarify the 

term ‘‘foreign entity of concern’’ by 

providing interpretations of the 

following key terms: ‘‘government of a 

foreign country;’’ ‘‘foreign entity;’’ 

‘‘subject to the jurisdiction;’’ and 

‘‘owned by, controlled by, or subject to 

the direction of.’’ 

DATES: DOE invites stakeholders to 

submit written comments on its 

interpretation. DOE will accept 

comments, data, and information 

regarding this interpretation no later 

than January 3, 2024. Only comments 

received through one of the methods 

described in the ADDRESSES section will 

be accepted. 

ADDRESSES: Interested persons are 

encouraged to submit comments using 

the Federal eRulemaking Portal at 

www.regulations.gov. Follow the 

instructions for submitting comments 

for RIN 1901–ZA02. 

Alternatively, interested persons may 

submit comments, including comments 

containing information for which 

disclosure is restricted by statute, such 

as trade secrets and commercial or 


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Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 84083 

financial information (hereinafter 

referred to as Confidential Business 

Information (CBI)) and appropriately 

marked as such, by email to 

FEOCguidance@hq.doe.gov. Please 

include RIN 1901–ZA02 in the subject 

line of the message. Please submit 

comments in Microsoft Word, or PDF 

file format, and avoid the use of 

encryption. 

FOR FURTHER INFORMATION CONTACT: 

Mallory Clites, U.S. Department of 

Energy, Office of Manufacturing and 

Energy Supply Chains at Email: 

FEOCguidance@hq.doe.gov, Telephone: 

202–287–1803. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

A. Background and Purpose 

B. Proposed FEOC Terminology 

Interpretations 

I. Foreign Entity 

II. Government of a Foreign Country 

III. Subject to the Jurisdiction 

IV. Owned by, Controlled by, or Subject to 

the Direction 

C. Explanation of Proposed Interpretation 

I. Foreign Entity 

II. Government of a Foreign Country 

III. Subject to the Jurisdiction 

IV. Owned by, Controlled by, or Subject to 

the Direction 

a. Control via 25% Interest 

b. Control via Licensing and Contracting 

D. Additional Request for Comments 

E. Public Comment Process 

F. Confidential Business Information 

G. Approval of the Office of the Secretary 

A. Background and Purpose 

Section 40207 of BIL (42 U.S.C. 

18741) provides DOE $6 billion to 

support domestic battery material 

processing, manufacturing, and 

recycling. Section 40207(b)(3)(C) directs 

DOE to prioritize material processing 

applicants that will not use battery 

material supplied by or originating from 

a ‘‘foreign entity of concern’’ (FEOC). 

Similarly, section 40207(c)(3)(C) directs 

DOE to prioritize manufacturing 

applicants who will not use battery 

material supplied by or originating from 

a FEOC and prioritize recycling 

applicants who will not export 

recovered critical materials to a FEOC. 

FEOC is defined in BIL section 

40207(a)(5). The relevant paragraph lists 

five grounds upon which a foreign 

entity is considered a FEOC. 

Subparagraphs (A), (B), and (D) address 

entities designated as foreign terrorist 

organizations by the Secretary of State, 

included on the Specially Designated 

Nationals and Blocked Persons List 

(SDN List) maintained by the 

Department of the Treasury’s Office of 

Foreign Assets Control (OFAC), and 

alleged by the Attorney General to have 

been involved in various illegal 

activities, including espionage and arms 

exports, for which a conviction was 

obtained, respectively. Subparagraph (C) 

states that a foreign entity is a FEOC if 

it is ‘‘owned by, controlled by, or 

subject to the jurisdiction or direction of 

a government of a foreign country that 

is a covered nation (as defined in [10 

U.S.C. 4872(d)(2)]).’’ The ‘‘covered 

nations’’ are the People’s Republic of 

China (PRC), the Russian Federation, 

the Democratic People’s Republic of 

North Korea, and the Islamic Republic 

of Iran (10 U.S.C. 4872(d)(2)). BIL 

section 40207(a)(5) provides no further 

definition of the term ‘‘foreign entity’’ or 

of the terms used in subparagraph (C). 

Subparagraph (E) of BIL section 

40207(a)(5) provides an additional 

means by which an entity may be 

designated to be a FEOC: a foreign entity 

is a FEOC if it is ‘‘determined by the 

Secretary [of Energy], in consultation 

with the Secretary of Defense and the 

Director of National Intelligence, to be 

engaged in unauthorized conduct that is 

detrimental to the national security or 

foreign policy of the United States.’’ 

In addition to affecting which entities 

DOE will prioritize as part of its BIL 

section 40207 Battery Materials 

Processing and Battery Manufacturing 

and Recycling Grant Programs, the term 

is cross-referenced in section 30D of the 

Internal Revenue Code (IRC) (26 U.S.C. 

30D), as amended by the Inflation 

Reduction Act of 2022 (IRA). Section 

30D provides a tax credit for new clean 

vehicles, including battery electric 

vehicles. Section 30D(d)(7) excludes 

from the definition of ‘‘new clean 

vehicle’’ ‘‘(A) any vehicle placed in 

service after December 31, 2024, with 

respect to which any of the applicable 

critical minerals contained in the 

battery of such vehicle (as described in 

[section 30D(e)(1)(A)]) were extracted, 

processed, or recycled by a [FEOC] (as 

defined in section 40207(a)(5) [of BIL] 

(42 U.S.C. 18741(a)(5))), or (B) any 

vehicle placed in service after December 

31, 2023, with respect to which any of 

the components contained in the battery 

of such vehicle (as described in section 

30D(e)(2)(A)) were manufactured or 

assembled by a [FEOC] (as so defined).’’ 

DOE is issuing this proposed 

guidance regarding which foreign 

entities qualify as FEOCs as a result of 

being ‘‘owned by, controlled by, or 

subject to the jurisdiction or direction of 

a government of a foreign country that 

is a covered nation.’’ DOE considers this 

proposed guidance to be a proposed 

interpretive rule for purposes of section 

553 of the Administrative Procedure Act 

(APA) (5 U.S.C. 551 et seq.) and does 

not consider this guidance to be a 

legislative rule subject to the procedural 

requirements of that section. For the 

purposes of this document, DOE uses 

the term ‘‘interpretive rule’’ and 

‘‘guidance’’ interchangeably. 

Subsequent to the issuance of this 

interpretive rule, DOE intends to 

promulgate separate regulations 

implementing the Secretary’s 

‘‘determination authority’’ contained in 

BIL section 40207(a)(5)(E) (42 U.S.C. 

18741(a)(5)(E)). 

In accordance with section 553 of the 

APA, public notice and opportunity for 

comment is not required for an 

interpretive rule. Nevertheless, to get 

the benefit of input from the public and 

interested stakeholders, the Department 

specifically requests comments on its 

proposed interpretation of the terms 

discussed herein. This document is 

intended to solicit public feedback on 

the DOE interpretation to better 

understand stakeholder perspectives 

prior to implementation of finalized 

guidance. The Department will consider 

all comments received during the public 

comment period, and modify its 

proposed approach, as appropriate, 

based on public comment. 

This proposed guidance proceeds as 

follows: Section B provides DOE’s 

interpretation of the relevant terms 

related to whether a foreign entity is a 

FEOC as the result of being owned by, 

controlled by, or subject to the 

jurisdiction or direction of a government 

of a foreign country that is a covered 

nation; Section C provides an 

explanation of DOE’s interpretation, 

along with citations to analogous 

provisions in other statutory and 

regulatory contexts that DOE consulted 

in making its interpretation; and Section 

D identifies some specific topics on 

which DOE requests comment from the 

public. 

B. Proposed FEOC Terminology 

Interpretations 

DOE proposes to clarify the term 

‘‘foreign entity of concern’’ by providing 

interpretations for the following terms 

within BIL section 40207(a)(5)(C) (42 

U.S.C. 18741(a)(5)(C)): ‘‘government of a 

foreign country;’’ ‘‘foreign entity;’’ 

‘‘subject to the jurisdiction;’’ and 

‘‘owned by, controlled by, or subject to 

the direction of.’’ These terms are 

interpreted separately, recognizing that 

the terms have unique meaning. DOE 

also proposes interpretations of 

additional terms necessary to provide 

clarity. 

For DOE’s proposed guidance, an 

entity is determined to be a FEOC under 

BIL section 40207(a)(5)(C) if it meets the 

definition of a ‘‘foreign entity,’’ (Section 

B.I) and either is ‘‘subject to the 


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84084 Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 

jurisdiction’’ of a covered nation 

government (Section B.III) or is ‘‘owned 

by, controlled by, or subject to the 

direction of’’ (Section B.IV) the 

‘‘government of a foreign country’’ 

(Section B.II) that is a covered nation. 

I. Foreign Entity 

DOE proposes to interpret ‘‘foreign 

entity’’ to mean: 

(i) A government of a foreign country; 

(ii) A natural person who is not a 

lawful permanent resident of the United 

States, citizen of the United States, or 

any other protected individual (as such 

term is defined in 8 U.S.C. 1324b(a)(3)); 

(iii) A partnership, association, 

corporation, organization, or other 

combination of persons organized under 

the laws of or having its principal place 

of business in a foreign country; or 

(iv) An entity organized under the 

laws of the United States that is owned 

by, controlled by, or subject to the 

direction (as interpreted in Section IV) 

of an entity that qualifies as a foreign 

entity in paragraphs (i)–(iii). 

II. Government of a Foreign Country 

DOE proposes to interpret 

‘‘government of a foreign country’’ to 

mean: 

(i) A national or subnational 

government of a foreign country; 

(ii) An agency or instrumentality of a 

national or subnational government of a 

foreign country; 

(iii) A dominant or ruling political 

party (e.g., Chinese Communist Party 

(CCP)) of a foreign country; or 

(iv) A current or former senior foreign 

political figure. 

Senior foreign political figure means 

(a) a senior official, either in the 

executive, legislative, administrative, 

military, or judicial branches of a 

foreign government (whether elected or 

not), or of a dominant or ruling foreign 

political party, and (b) an immediate 

family member (spouse, parent, sibling, 

child, or a spouse’s parent and sibling) 

of any individual described in (a). 

‘‘Senior official’’ means an individual 

with substantial authority over policy, 

operations, or the use of governmentowned resources. 

III. Subject to the Jurisdiction 

DOE proposes that a foreign entity is 

‘‘subject to the jurisdiction’’ of a covered 

nation government if: 

(i) The foreign entity is incorporated 

or domiciled in, or has its principal 

place of business in, a covered nation; 

or 

(ii) With respect to the critical 

minerals, components, or materials of a 

given battery, the foreign entity engages 

in the extraction, processing, or 

recycling of such critical minerals, the 

manufacturing or assembly of such 

components, or the processing of such 

materials, in a covered nation. 

IV. Owned by, Controlled by, or Subject 

to the Direction 

DOE proposes that an entity is 

‘‘owned by, controlled by, or subject to 

the direction’’ of another entity 

(including the government of a foreign 

country that is a covered nation) if: 

(i) 25% or more of the entity’s board 

seats, voting rights, or equity interest are 

cumulatively held by that other entity, 

whether directly or indirectly via one or 

more intermediate entities; or 

(ii) With respect to the critical 

minerals, battery components, or battery 

materials of a given battery, the entity 

has entered into a licensing arrangement 

or other contract with another entity (a 

contractor) that entitles that other entity 

to exercise effective control over the 

extraction, processing, recycling, 

manufacturing, or assembly 

(collectively, ‘‘production’’) of the 

critical minerals, battery components, or 

battery materials that would be 

attributed to the entity. 

Cumulatively held. For the purposes 

of determining control by a foreign 

entity (including the government of a 

foreign country), control is evaluated 

based on the combined interest in an 

entity held, directly or indirectly, by all 

other entities that qualify under the 

above interpretation of ‘‘foreign entity.’’ 

Additionally, an entity that qualifies as 

a ‘‘government of a foreign country that 

is a covered nation’’ enters into a formal 

arrangement to act in concert with 

another entity or entities that have an 

interest in the same third-party entity, 

the cumulative board seats, voting 

rights, or equity interests of all such 

entities are combined for the purpose of 

determining the level of control 

attributable to each of those entities. 

Indirect control. For purposes of 

determining whether an entity 

indirectly holds board seats, voting 

rights, or equity interest in a tiered 

ownership structure: 

• If a ‘‘parent’’ entity (including the 

government of a foreign country) 

directly holds 50% or more of a 

‘‘subsidiary’’ entity’s board seats, voting 

rights, or equity interest, then the parent 

and subsidiary are treated as equivalent 

in the evaluation of control, as if the 

subsidiary were an extension of the 

parent. As such, any holdings of the 

subsidiary are fully attributed to the 

parent. 

• If a ‘‘parent’’ entity directly holds 

less than 50% of a ‘‘subsidiary’’ entity’s 

board seats, voting rights, or equity 

interest, then indirect ownership is 

attributed proportionately. 

Section C, contains multiple scenarios 

illustrating how to determine when an 

entity is indirectly controlled under this 

interpretive rule. 

Effective control means the right of 

the contractor in the contractual 

relationship to determine the quantity 

or timing of production, to determine 

which entities may purchase or use the 

output of production, or to restrict 

access to the site of production to the 

contractor’s own personnel; or the 

exclusive right to maintain, repair, or 

operate equipment that is critical to 

production. 

In the case of a contract with a FEOC, 

a contractual relationship will be 

deemed to not confer effective control 

by the FEOC if the applicable 

agreement(s) reserves expressly to one 

or more non-FEOC entities all of the 

following rights: 

(i) To determine the quantity of 

critical mineral, component, or material 

produced (subject to any overall 

maximum or minimum quantities 

agreed to by the parties prior to 

execution of the contract); 

(ii) To determine, within the overall 

contract term, the timing of production, 

including when and whether to cease 

production; 

(iii) To use the critical mineral, 

component, or material for its own 

purposes or, if the agreement 

contemplates sales, to sell the critical 

mineral, component, or material to 

entities of its choosing; 

(iv) To access all areas of the 

production site continuously and 

observe all stages of the production 

process; and 

(v) At its election, to independently 

operate, maintain, and repair all 

equipment critical to production and to 

access and use any intellectual property, 

information, and data critical to 

production, notwithstanding any export 

control or other limit on the use of 

intellectual property imposed by a 

covered nation subsequent to execution. 

C. Explanation of Proposed 

Interpretation 

The term FEOC, as used in both BIL 

section 40207 and IRC section 30D, is 

intended to address upstream supply 

chains of individual entities that may 

benefit from direct or indirect federal 

government financial support. As such, 

the interpretations proposed above are 

intended to be structured as, to the 

greatest degree possible, bright-line 

rules that would allow individual 

entities to readily evaluate whether their 

upstream suppliers would or would not 

be considered FEOCs. In the case of the 


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Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 84085 

Battery Manufacturing and Recycling 

Grants Program in BIL section 40207, a 

bright-line rule will afford eligible 

entities using their grants for battery 

recycling greater clarity in avoiding the 

export of recovered critical materials to 

a FEOC. 

I. Foreign Entity 

To be considered a FEOC under BIL 

section 40207(a)(5) (42 U.S.C. 

18741(a)(5)), the statute requires that the 

entity be a ‘‘foreign entity.’’ However, 

section 40207 does not define ‘‘foreign 

entity.’’ 

The interpretation of ‘‘foreign entity’’ 

in this proposed guidance aligns closely 

with the definition of ‘‘foreign entity’’ 

contained in the 2021 National Defense 

Authorization Act (NDAA) (15 U.S.C. 

4651(6)), which informs certain 

Department of Commerce programs 

related to semiconductors. Both the 

interpretation proposed in this guidance 

and the 2021 NDAA definitions define 

foreign entities to include three main 

categories of entities: (1) a government 

of a foreign country and a foreign 

political party; (2) a natural person who 

is not a lawful permanent resident of the 

United States, citizen of the United 

States, or any other protected individual 

(as such term is defined in 8 U.S.C. 

1324b(a)(3) (addressing unfair 

immigration-related employment 

practices)); or (3) a partnership, 

association, corporation, organization, 

or other combination of persons 

organized under the laws of or having 

its principal place of business in a 

foreign country. 

DOE’s interpretation in this proposed 

guidance specifically provides that 

entities organized under the laws of the 

United States that are subject to the 

ownership, control, or direction of 

another entity that qualifies as a foreign 

entity will also qualify as ‘‘foreign 

entities’’ for the purposes of BIL section 

40207(a)(5)(C). The 2021 NDAA 

definition of foreign entity allows for 

U.S. entities to be considered foreign in 

this way and also provides an additional 

list of criteria by which such persons 

may be considered foreign due to their 

relationship with the three main 

categories of foreign entities. While 

these criteria are relevant for the 

purposes of the Department of 

Commerce programs at issue, which are 

primarily concerned with preventing 

the transfer of semiconductor 

technology to covered nation 

governments, DOE assesses that the 

criteria are not necessary for the 

purpose of evaluating covered nationassociated risk to the battery supply 

chains, because the natural persons and 

corporate entities that are relevant to the 

battery supply chain are already 

encompassed in the identified criteria 

for ‘‘foreign entity.’’ DOE’s 

interpretation ensures that governments 

of covered nations cannot evade the 

FEOC restriction simply by establishing 

a U.S. subsidiary, while otherwise 

maintaining ownership or control over 

that subsidiary. 

II. Government of a Foreign Country 

‘‘Government of a foreign country’’ is 

a term used to determine whether an 

entity is ‘‘owned by, controlled by, or 

subject to the jurisdiction or direction of 

a government of a foreign country.’’ It is 

also used in the proposed interpretation 

of ‘‘foreign entity’’ in paragraph (i) of 

Section B.I. 

The proposed interpretation of the 

term ‘‘government of a foreign country’’ 

contained within this notice includes 

subnational governments, which can 

have significant ownership or control of 

firms in the vehicle supply chain. In the 

covered nations at issue here, there exist 

many subnational and local 

government-owned entities, that play a 

large role in their nation’s economies, 

and local state-owned enterprises 

(SOEs) are a large driver of regional 

economies. This term also includes 

instrumentalities, which include 

separate legal entities that are organs of 

a state but where ownership may be 

unclear, such as a utility or public 

financial institution. This interpretation 

aligns with the definition of ‘‘foreign 

government’’ promulgated by the 

Department of the Treasury in its 

regulations implementing the 

Committee on Foreign Investment in the 

United States (CFIUS) program (31 CFR 

800.221). That definition includes 

‘‘national and subnational governments, 

including their respective departments, 

agencies, and instrumentalities.’’ 

The proposed interpretation of the 

term ‘‘government of a foreign country’’ 

also includes senior foreign political 

figures. This inclusion recognizes the 

reality of government influence over 

business entities in covered nations, 

which is often exercised through 

individuals representing the 

government on corporate boards or 

acting at the direction of the government 

or to advance governmental interests 

when serving as an equity owner or 

through voting interests in an otherwise 

privately held business. This 

interpretation aligns with the Defense 

Department’s National Industrial 

Security Program Operating Manual 

(NISPOM) regulatory definition of 

‘‘foreign interest’’ (32 CFR 117.3) and 

associated ‘‘foreign ownership, control 

or influence’’ (FOCI) regulations (32 

CFR 117.11), which recognize as FOCI 

the influence of a representative of a 

foreign government with the power to 

direct or decide issues related to a U.S. 

entity. In addition, in order to deal with 

the situation in which officials leave 

their official positions in order to exert 

the same type of influence on behalf of 

the government, the interpretation also 

includes former senior government 

officials and former senior party leaders. 

Inclusion of former officials is 

consistent with regulatory definitions in 

other contexts. For example, the Bank 

Secrecy Act (BSA) private banking 

account regulations (relating to due 

diligence program requirements for 

private banking accounts established, 

maintained, administered, or managed 

in the United States for foreign persons) 

administered by the Department of the 

Treasury’s Financial Crimes 

Enforcement Network (FinCEN) include 

both current and former officials in the 

definition of ‘‘senior foreign political 

figure’’ (31 CFR 1010.605(p)). Those 

regulations provide further 

interpretation of the term ‘‘senior 

official’’ that DOE has also included to 

provide additional clarity. 

In the specific context of the CCP in 

the PRC, DOE considers its 

interpretation of ‘‘government of a 

foreign country’’ to include current 

members of Chinese People’s Political 

Consultative Conference and current 

and former members of the Politburo 

Standing Committee, the Politburo, the 

Central Committee, and the National 

Party Congress because they qualify as 

‘‘senior foreign political figures.’’ 

Finally, the inclusion of immediate 

family members of senior foreign 

political figures in the interpretation of 

‘‘government of a foreign country’’ 

aligns with the BSA private banking 

regulation. Those regulations include 

the immediate family members of a 

senior foreign political figure in their 

definition of ‘‘senior foreign political 

figure’’ (31 CFR 1010.605(p)(1)(iii)). 

Immediate family members in those 

regulations mean spouses, parents, 

siblings, children, and a spouse’s 

parents and siblings (31 CFR 

1010.605(p)(2)(ii)). 

III. Subject to the Jurisdiction 

If an entity is ‘‘subject to the 

jurisdiction’’ of a government of a 

foreign country that is a covered nation, 

the entity is a FEOC. DOE’s proposed 

interpretation provides an objective 

standard, consistent with the common 

understanding of ‘‘jurisdiction,’’ rather 

than a subjective standard that relies 

upon an individual nation’s 

understanding of its own jurisdictional 

reach. As such, the interpretation first 

recognizes that any organization formed 


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1 100-day-supply-chain-review-report.pdf 

(whitehouse.gov). 

under the laws of the government of a 

covered nation is a national of that 

nation and therefore subject to its direct 

legal reach. Cf. 28 U.S.C. 1332(c)(1) 

(noting that, for the purposes of 

diversity jurisdiction, ‘‘a corporation 

shall be deemed to be a citizen of every 

. . . foreign state by which it has been 

incorporated and of the . . . foreign 

state where it has its principal place of 

business’’). 

Second, DOE’s proposal accounts for 

the fact that several critical segments of 

the battery supply chain today are 

predominantly processed and 

manufactured within covered nation 

boundaries,1 and recognizes that a 

covered nation will be able to exercise 

legal control (potentially forcing an 

entity to cease production or cease 

exports) over an entity with respect to 

any critical minerals that are physically 

extracted, processed, or recycled, any 

battery components that are 

manufactured or assembled, and any 

battery materials that are processed 

within those boundaries, even if the 

entity is not legally formed under the 

laws of the covered nation. See Third 

Restatement (Foreign Relations) (1986) 

section 402(1) (stating that a state has 

‘‘jurisdiction to prescribe law with 

respect to [conduct, persons, and 

interests] within its territory’’). At the 

same time, DOE’s interpretation 

recognizes that such an entity, which is 

not legally formed in a covered nation 

but has production activities inside a 

covered nation, may also have separate 

production activities that occur outside 

the covered nation. In that case, the 

covered nation does not have 

jurisdiction over those outside 

production activities. Therefore, under 

the proposed guidance, an entity that is 

not legally incorporated in a covered 

nation could be nevertheless considered 

a FEOC under the jurisdiction prong 

with respect to the particular critical 

minerals, battery components, or battery 

materials that are subject to the 

jurisdiction of a covered nation. But the 

entity would not be considered a FEOC 

with respect to its activities related to 

other critical minerals, battery 

components, or battery materials that 

are not subject to the jurisdiction of a 

covered nation. 

Finally, when an entity is a FEOC due 

to it being ‘‘subject to the jurisdiction’’ 

of a covered nation, subsidiaries of the 

FEOC are not automatically considered 

to also be FEOCs solely based on their 

parent being a covered nation 

jurisdictional entity. However, a 

subsidiary entity would be a FEOC itself 

if it is also either (1) ‘‘subject to the 

jurisdiction’’ of the covered nation, 

pursuant to Section B.III, or (2) 

‘‘controlled by’’ a covered nation 

government, pursuant to Section B.IV. 

DOE’s interpretation is supported by 

statutory and regulatory choices made 

in similar contexts, including: the 2021 

NDAA definition of ‘‘foreign entity’’ (15 

U.S.C. 4651(6)); and the NISPOM 

regulatory definition of ‘‘foreign 

interest’’ (32 CFR 117.3). The above 

interpretation of ‘‘subject to the 

jurisdiction’’ provides clarity to original 

equipment manufacturers (OEM) that 

removing FEOCs from their supply 

chain will require removal of any 

critical minerals, battery components, 

and battery materials that are directly 

produced within the boundary of a 

covered nation. 

IV. Owned by, Controlled by, or Subject 

to the Direction 

If an entity is ‘‘owned by, controlled 

by, or subject to the direction’’ of 

(hereinafter ‘‘controlled by’’) a 

government of a foreign country that is 

a covered nation, the entity is a FEOC. 

The term is also used in paragraph (iv) 

of the proposed interpretation of foreign 

entity to account for situations where a 

U.S. entity is sufficiently controlled to 

be considered foreign. DOE’s proposed 

interpretation provides for both (1) 

control via the holding of 25% or more 

of an entity’s board seats, voting rights, 

or equity interest, and (2) control via 

license or contract conferring rights on 

a person that amount to a conferral of 

control. 

Not all foreign entities are considered 

FEOCs. However, if an entity is a foreign 

entity that is ‘‘controlled by’’ a covered 

nation government, that entity is a 

FEOC. A subsidiary of that FEOC is not 

automatically considered a FEOC itself 

unless the subsidiary is either (1) 

‘‘subject to the jurisdiction’’ of a covered 

nation government, or (2) ‘‘controlled 

by’’ a covered nation government 

(including via direct or indirect control, 

such as through joint ventures, or via 

contracts that confer effective control to 

a FEOC). As such, a FEOC that is 

controlled by a covered nation 

government may hold an interest in a 

subsidiary, even an interest above 25%, 

and that subsidiary may still not be a 

FEOC if the covered nation’s level of 

control of the subsidiary falls below 

25% (see scenario 3 below). 

a. Control via 25% Interest 

DOE’s interpretation of control is 

informed by careful analysis of 

corporate structure within the battery 

supply chain. In the battery industry, 

the primary methods by which a parent 

entity, including a government of a 

foreign country, exercises control over 

another entity is through voting interest, 

equity ownership, and/or boards of 

directors. Parent entities may exercise 

control via majority ownership of 

shares, voting interest, or board seats, 

and also through minority holdings. 

Furthermore, parent entities may act in 

concert with other investors to combine 

minority holdings to exercise control. 

As a result, an effective measure of 

control is one that considers multiple 

permutations of majority and minority 

holdings of equity, voting rights, and 

board seats that can cumulatively confer 

control. 

While there are several prominent 

companies within the battery supply 

chain that are majority-owned by 

covered nation governments, 

particularly in the upstream mining 

segment, the predominant form of state 

ownership and influence in most 

segments of the battery supply chain is 

through minority shareholding, voting 

rights, or board seats. DOE has 

evaluated a range of supply chain 

entities for which covered nation 

governments and officials with 

cumulative holdings between 25% and 

50% have meaningful influence over 

corporate decision-making, even in 

cases of subsidiary entities operating in 

other jurisdictions and in the case of 

multiple minority shareholders acting in 

concert. However, DOE’s assessment of 

the battery supply chain strongly 

suggests that minority control can 

attenuate with multiple tiers of 

separation between the state and the 

firm performing the covered activity. 

DOE recognizes that a bright-line 

metric for control will be necessary to 

ensure that OEMs can feasibly evaluate 

the presence of FEOCs within their 

supply chains. Informed by empirical 

evidence in the battery supply chain 

and choices made in other regulatory 

contexts, discussed further below, 

DOE’s interpretation establishes a 25% 

threshold and guidance on calculation 

of the attenuation of control in a tiered 

ownership structure. In the case of 

majority control by a covered nation 

government, that control is not diluted 

such that outright ownership (50%+) 

confers full control. This ensures that a 

government-controlled company that 

has majority ownership of a subsidiary 

passes along control. However, multiple 

layers of minority control by a 

government may become so attenuated 

that an entity would no longer be 

classified as a FEOC. This bright-line 

threshold and guidance on how to 

calculate control will enable an 

evaluation of battery supply chains and 

facilitate any required reporting or 


ddrumheller on DSK120RN23PROD with PROPOSALS1
Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 84087 

certification of whether that supply 

chain includes products produced by a 

FEOC. This same analysis applies to 

joint ventures, such that if the 

government of foreign country that is a 

covered nation controls, either directly 

or indirectly, 25% or more of a joint 

venture, then that joint venture is a 

FEOC. 

DOE’s interpretation is supported by 

choices made in a variety of statutory 

and regulatory regimes and it has 

devised a method that accounts for the 

specific circumstances present in the 

battery industry. DOE takes a broad 

approach to the interests that count 

towards the 25% threshold, considering 

board seats, voting rights, and equity 

interest. This is consistent with FOCI 

regulations, which evaluate ownership 

based on equity ownership interests 

sufficient to provide ‘‘the power to 

direct or decide issues affecting the 

entity’s management or operations’’ (32 

CFR 117.11(a)(1)). The interpretation 

that the interests of two entities with an 

agreement to act in concert may be 

combined to establish a controlling 

interest is similar to concepts in 

Securities and Exchange Commission 

rules defining beneficial ownership in 

instances of shareholders acting in 

concert (17 CFR 240.13d–5) and CFIUS 

regulations that consider arrangements 

to act in concert to determine, direct, or 

decide important matters affecting an 

entity as one means by which two or 

more entities may establish control over 

another entity (31 CFR 800.208(a)). 

Different thresholds of control are used 

in different statutory and regulatory 

contexts (see, for example, 26 U.S.C. 

6038(e)(2), (3) (defining control with 

respect to a corporation to mean actual 

or constructive ownership by a person 

of stock possessing more than 50% of 

the total combined voting power of all 

classes of stock entitled to vote or 50% 

of the total value of shares of all classes 

of stock of a corporation, and control 

with respect to a partnership to 

generally mean actual or constructive 

ownership of a more than 50% capital 

or profit interest in a partnership); and 

26 U.S.C. 368(c) (defining control with 

respect to certain corporate transactions 

to mean the ownership of stock 

possessing at least 80% of the total 

combined voting power of all classes of 

stock entitled to vote and at least 80% 

of the total number of shares of all other 

classes of stock of the corporation)). 

However, there are a number of 

analogous regulatory contexts in which 

a 25% threshold for considering an 

entity controlled is used. For instance, 

the Department of Commerce’s final rule 

in Preventing the Improper Use of 

CHIPS Act Funding, implementing a 

very similar FEOC provision, uses a 

25% threshold with respect to voting 

interest, board seats, and equity 

interests (88 FR 65600; Sept. 25, 2023). 

The State Department, in its 

International Traffic in Arms Regulation 

(ITAR) regulations, established a 

presumption of foreign control where 

foreign persons own 25% or more of the 

outstanding voting securities of an 

entity, unless one U.S. person controls 

an equal or larger percentage (22 CFR 

120.65). FinCEN’s BSA private banking 

account regulations (31 CFR 

1010.605(j)(1)(i)) and Beneficial 

Ownership Reporting Rule (31 CFR 

1010.380(d)) also contain 25% 

ownership thresholds. See also 15 CFR 

760.1(c) (defining ‘‘controlled in fact’’ 

using a 25% threshold for cases where 

no other person controls an equal or 

larger percentage of voting securities). In 

some of these other contexts, the 25% 

calculation is based on a particular form 

of control (e.g., only voting shares). 

DOE’s interpretation broadens the forms 

of control that are relevant to the 25%, 

because doing so accords with statutory 

concerns related to the corporate 

structure of the battery industry. 

DOE’s interpretation of indirect 

control includes guidance on how to 

calculate the attenuation of control in a 

tiered ownership structure. In the case 

of majority control, that control is not 

attenuated such that outright ownership 

(50%+) confers full control. The 

proposed approach recognizes the 

reality that a parent entity that holds a 

majority of the voting interest, equity, or 

board seats in a subsidiary has 

unilateral control over that subsidiary 

and can direct that subsidiary’s ability 

to exercise influence and control over 

its own subsidiaries. However, in the 

case of multiple tiers of minority control 

by a government, the actual ability of 

the government to influence the 

operations of a subsidiary may become 

so attenuated that the subsidiary would 

no longer reasonably be deemed 

‘‘controlled’’ by the government. This 

understanding of how to calculate a 

parent entity’s indirect ownership and 

control of sub-entities is similar to 

OFAC’s 50% Rule, under which ‘‘any 

entity owned in the aggregate, directly 

or indirectly, 50% or more by one or 

more blocked persons is itself 

considered to be a blocked person.’’ See 

U.S. Dept. of the Treasury, Revised 

Guidance on Entities Owned by Persons 

Whose Property and Interests in 

Property are Blocked (Aug. 13, 2014). 

When calculating whether an entity is 

a FEOC based on whether the 

government of a covered nation directly 

or indirectly holds 25% or more of its 

voting share, equity interest, or board 

seats, DOE’s interpretation would not 

factor in any voting share, equity 

interest, or board seats held by an entity 

that is a FEOC solely by virtue of being 

subject to the covered nation’s 

jurisdiction. 

The following scenarios illustrate 

indirect control in a tiered ownership 

structure: 

1. If Entity A cumulatively holds 25% 

of Entity B’s board seats, voting rights, 

or equity interest, then Entity A directly 

controls Entity B. If Entity B 

cumulatively holds 50% of Entity C’s 

board seats, voting rights, or equity 

interest, then Entities B and C are 

treated as the same entity, and Entity A 

also indirectly controls Entity C. 

Æ If Entity A is the government of a 

foreign country that is a covered nation, 

Entities B and C are both FEOCs. 

2. If Entity A cumulatively holds 50% 

of Entity B’s board seats, voting rights, 

or equity interest, then Entity A is the 

direct controlling ‘‘parent’’ of Entity B, 

and Entities A and B are treated as the 

same entity. If Entity B cumulatively 

holds 25% of Entity C’s board seats, 

voting rights, or equity interest, then 

Entity C is understood to be directly 

controlled by Entity B and indirectly 

controlled by Entity A. 

Æ If Entity A is the government of a 

foreign country that is a covered nation, 

Entities B and C are both FEOCs. 

3. If Entity A cumulatively holds 25% 

of Entity B’s board seats, voting rights, 

or equity interest, then Entity A directly 

controls Entity B. If Entity B 

cumulatively holds 40% of Entity C’s 

board seats, voting rights, or equity 

interest, then Entity B directly controls 

Entity C. However, because Entity A 

does not hold 50% of the board seats, 

voting rights, or equity interest of Entity 

B, and Entity B does not hold 50% of 

the board seats, voting rights, or equity 

interest of Entity C, Entity A’s indirect 

control of Entity C is calculated 

proportionately (25% × 40% = 10%). 

Based on that proportionate calculation, 

Entity A will be considered to hold only 

a 10% interest in Entity C, which is 

insufficient to meet the 25% threshold 

for control contemplated under this 

proposed guidance. 

Æ If Entity A is the government of a 

foreign country that is a covered nation, 

Entity B is a FEOC. But Entity A holds 

only a 10% interest in Entity C, which 

is less than the 25% threshold 

requirement to deem Entity C controlled 

by Entity A. Therefore, Entity C is not 

a FEOC via the indirect control of Entity 

A. 


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84088 Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 

b. Control via Licensing and Contracting 

DOE is concerned that if ‘‘controlled 

by’’ covered only direct and indirect 

holding of board seats, voting rights, 

and equity interest by the governments 

of covered nations, such governments 

may seek to evade application of the 

interpretation by instead controlling 

FEOCs that contract with non-FEOC 

entities to be the producer of record 

while the FEOC maintains effective 

control over production. Because such 

arrangements would defeat 

congressional intent, DOE proposes an 

interpretation of ‘‘controlled by’’ that 

includes ‘‘effective control’’ through 

contracts or licenses with a FEOC that 

warrant treating the FEOC as if it were 

the true entity responsible for any 

production. 

Many contractual and licensing 

arrangements do not raise these 

concerns. Therefore, to provide a 

reasonably bright-line test for evaluation 

of upstream battery supply chains that 

include numerous contracts and 

licenses, DOE has proposed in Section 

B.IV a safe harbor for evaluation of 

‘‘effective control.’’ A non-FEOC entity 

that can demonstrate that it has reserved 

certain rights to itself or another nonFEOC through contract would not be 

deemed to be a FEOC solely based on 

its contractual relationships. 

DOE also recognizes that even if an 

entity’s contractual relationship with a 

FEOC confers effective control over the 

production of particular critical 

minerals, battery components, or battery 

materials, the contracting entity would 

not necessarily be controlled by the 

government of a covered nation for 

critical minerals, battery components, or 

battery materials that were not produced 

pursuant to that contract or license. 

Therefore, under the proposed 

guidance, an entity could be considered 

a FEOC with respect to the particular 

critical minerals, battery components, or 

battery materials that are effectively 

produced by the FEOC under a contract 

or license but not with respect to other 

critical minerals, battery components, or 

battery materials that are produced by 

the entity outside the terms of the 

contract or license with a FEOC. 

The concept that an entity can be 

controlled via contract is supported by 

choices made in various regulatory 

contexts, including CFIUS regulations 

that include an understanding that 

control can be established via 

contractual arrangements to determine, 

direct, or decide important matters 

affecting an entity (31 CFR 800.208(a)). 

Further, intellectual property can be 

licensed restrictively, or even misused, 

to give the intellectual property owner 

rights beyond the typical ability to 

exclude others from making, using, 

selling, and/or copying the intellectual 

property for a limited time. In this 

scenario, ownership of a facility by an 

entity that does not have 25% voting 

interest, equity, or board seats held, 

directly or indirectly, by the government 

of a covered nation, would not be 

sufficient if a FEOC licensor or 

contractor maintains effective control 

through other mechanisms. 

Accordingly, DOE has proposed a 

definition of effective control that 

identifies criteria that would indicate 

that a license or contract provides the 

licensor or contractor with the ability to 

make business or operational choices 

that otherwise would rest with the 

licensee or principal. The criteria 

selected reflect various known 

mechanisms in restrictive or 

overreaching licenses such as lack of 

access by the licensee or principal to 

information and data (e.g., control 

parameters or specification and 

quantities of material input for 

equipment) that are necessary to operate 

equipment critical to production at 

necessary quality and throughput levels. 

This lack of access could be tantamount 

to the licensor or contractor having 

effective control over the licensee or 

principal. 

D. Additional Request for Comments 

As explained in Section A, DOE 

requests comment on its proposed 

interpretations outlined in Section B, as 

well as the reasoning provided in 

Section C. Subsequent to the issuance of 

this interpretive guidance, DOE intends 

to promulgate separate regulations 

implementing the Secretary’s 

determination authority contained in 

BIL section 40207(a)(5)(E). As such, 

DOE also requests comment on the 

following. 

DOE recognizes that entities could 

attempt to evade ownership and control 

restrictions in various ways without 

materially changing the extent to which 

they are, in fact, subject to the 

ownership, control, or direction of a 

covered nation as defined in this 

guidance. Section 40207(a)(5)(E) of BIL 

includes as FEOCs those foreign entities 

‘‘determined by the Secretary [of 

Energy], in consultation with the 

Secretary of Defense and the Director of 

National Intelligence, to be engaged in 

unauthorized conduct that is 

detrimental to the national security or 

foreign policy of the United States.’’ 

Accordingly, DOE requests comment on 

whether use of this determination 

authority could provide a tool for 

limiting attempts to evade such 

restrictions and what DOE may deem 

‘‘unauthorized conduct.’’ DOE requests 

specific comment on whether, in 

addition to or instead of defining 

‘‘owned by, controlled by, or subject to 

the direction of’’ to include effective 

control via contractual arrangement, 

DOE should consider whether a given 

contractual or licensing arrangement, or 

operational practice with a contractor or 

licensor, is a means of evading 

restrictions on production by a FEOC 

that would warrant use of its 

determination authority in BIL section 

40207(a)(5)(E). For example, DOE 

recognizes that even if certain rights are 

reserved by a non-FEOC licensee in its 

contractual arrangement with a FEOC, a 

FEOC licensor may nevertheless compel 

the licensee through leverage or 

coercion to not exercise the licensee’s 

contractual rights. DOE could construe 

any such overt compulsion by a FEOC 

licensor as unauthorized conduct, 

potentially subject to the determination 

authority. DOE requests comment on 

whether there are any other 

circumstances related to contractual 

arrangements between entities and 

FEOCs that could constitute 

unauthorized conduct, potentially 

subject to the determination authority. 

In addition, in recognition of the fact 

that it may be particularly difficult to 

definitively evaluate the contractual 

relationships of upstream suppliers, 

DOE is also considering whether to 

provide entities with the opportunity to 

voluntarily request a review of contracts 

and licensing arrangements by DOE in 

order to provide additional certainty 

regarding whether effective control by a 

FEOC is present. DOE requests comment 

on whether such a voluntary pre-review 

process would be beneficial and 

administrable, including input on what 

process steps would be reasonable and 

the types of documents that should be 

submitted for review. 

E. Public Comment Process 

Comments submitted can be public or 

confidential. 

Do not submit to www.regulations.gov 

information claimed as CBI. Comments 

submitted through www.regulations.gov 

cannot be claimed as CBI. Comments 

received through the website will waive 

any CBI claims for the information 

submitted. For information on 

submitting CBI, see the Confidential 

Business Information section. 

F. Confidential Business Information 

Pursuant to 10 CFR 1004.11, any 

person submitting information that he 

or she believes to be confidential and 

exempt by law from public disclosure 

should submit via email two wellmarked copies: one copy of the 


ddrumheller on DSK120RN23PROD with PROPOSALS1
Federal Register / Vol. 88, No. 231 / Monday, December 4, 2023 / Proposed Rules 84089 

1 88 FR 70391 (Oct. 11, 2023). 

document marked ‘‘confidential’’ 

including all the information believed to 

be confidential, and one copy of the 

document marked ‘‘non-confidential’’ 

with the information believed to be 

confidential deleted. Submit these 

documents via email at FEOCnotice@

hq.doe.gov. DOE will make its own 

determination about the confidential 

status of the information and treat it 

according to its determination. 

G. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of this Notification of 

proposed interpretive rule; request for 

comments. 

Signing Authority 

This document of the Department of 

Energy was signed on November 28, 

2023, by Giulia Siccardo, Director, 

Office of Manufacturing and Energy 

Supply Chains, pursuant to delegated 

authority from the Secretary of Energy. 

That document with the original 

signature and date is maintained by 

DOE. For administrative purposes only, 

and in compliance with requirements of 

the Office of the Federal Register, the 

undersigned DOE Federal Register 

Liaison Officer has been authorized to 

sign and submit the document in 

electronic format for publication, as an 

official document of the Department of 

Energy. This administrative process in 

no way alters the legal effect of this 

document upon publication in the 

Federal Register. 

Signed in Washington, DC, on November 

28, 2023. 

Treena V. Garrett, 

Federal Register Liaison Officer, U.S. 

Department of Energy. 

[FR Doc. 2023–26479 Filed 12–1–23; 8:45 am] 

BILLING CODE 6450–01–P 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Part 364 

RIN 3064–AF94 

Guidelines Establishing Standards for 

Corporate Governance and Risk 

Management for Covered Institutions 

With Total Consolidated Assets of $10 

Billion or More; Extension of Comment 

Period 

AGENCY: Federal Deposit Insurance 

Corporation. 

ACTION: Notice of proposed rulemaking 

and issuance of guidelines; extension of 

comment period. 

SUMMARY: On October 11, 2023, the 

Federal Deposit Insurance Corporation 

(FDIC) published in the Federal 

Register a proposal to issue Guidelines 

to FDIC’s standards for safety and 

soundness regulations and make 

conforming amendments to its 

regulations. These Guidelines would 

apply to all insured state nonmember 

banks, state-licensed insured branches 

of foreign banks, and insured state 

savings associations that are subject to 

Section 39 of the Federal Deposit 

Insurance Act (FDI Act), with total 

consolidated assets of $10 billion or 

more on or after the effective date of the 

final Guidelines. The FDIC has 

determined that an extension of the 

comment period until February 9, 2024, 

is appropriate. 

DATES: Comments must be received by 

February 9, 2024. 

ADDRESSES: The FDIC encourages 

interested parties to submit written 

comments. Please include your name, 

affiliation, address, email address, and 

telephone number(s) in your comment. 

You may submit comments to the FDIC, 

identified by RIN 3064–AF94, by any of 

the following methods: 

Agency Website: https://

www.fdic.gov/resources/regulations/ 

federal-register-publications. Follow 

instructions for submitting comments 

on the FDIC’s website. 

Mail: James P. Sheesley, Assistant 

Executive Secretary, Attention: 

Comments/Legal OES (RIN 3064–AF94), 

Federal Deposit Insurance Corporation, 

550 17th Street NW, Washington, DC 

20429. 

Hand Delivered/Courier: Comments 

may be hand-delivered to the guard 

station at the rear of the 550 17th Street 

NW building (located on F Street NW) 

on business days between 7 a.m. and 5 

p.m. 

Email: comments@FDIC.gov. Include 

RIN 3064–AF94 in the subject line of 

the message. 

Public Inspection: Comments 

received, including any personal 

information provided, may be posted 

without change to https://www.fdic.gov/ 

resources/regulations/federalregisterpublications/. Commenters 

should submit only information that the 

commenter wishes to make available 

publicly. The FDIC may review, redact, 

or refrain from posting all or any portion 

of any comment that it may deem to be 

inappropriate for publication, such as 

irrelevant or obscene material. The FDIC 

may post only a single representative 

example of identical or substantially 

identical comments, and in such cases 

will generally identify the number of 

identical or substantially identical 

comments represented by the posted 

example. All comments that have been 

redacted, as well as those that have not 

been posted, that contain comments on 

the merits of this notice will be retained 

in the public comment file and will be 

considered as required under all 

applicable laws. All comments may be 

accessible under the Freedom of 

Information Act. 

FOR FURTHER INFORMATION CONTACT: 

Division of Risk Management 

Supervision: Judy E. Gross, Senior 

Policy Analyst, (202) 898–7047, 

JuGross@FDIC.gov; Legal Division: 

Jennifer M. Jones, Counsel, (202) 898– 

6768; Catherine Topping, Counsel, (202) 

898–3975; Nicholas A. Simons, Senior 

Attorney, (202) 898–6785; Kimberly 

Yeh, Senior Attorney, (202) 898–6514. 

SUPPLEMENTARY INFORMATION: On 

October 11, 2023, the FDIC published in 

the Federal Register a proposal to issue 

Guidelines as Appendix C to FDIC’s 

standards for safety and soundness 

regulations in part 364 and make 

conforming amendments to parts 308 

and 364 of its regulations.1 These 

Guidelines would apply to all insured 

state nonmember banks, state-licensed 

insured branches of foreign banks, and 

insured state savings associations that 

are subject to section 39 of the FDI Act 

with total consolidated assets of $10 

billion or more on or after the effective 

date of the final Guidelines. The 

Guidelines are intended to set the 

FDIC’s expectations for covered 

institutions regarding corporate 

governance, risk management, and 

oversight by the board of directors. The 

notice of proposed rulemaking stated 

that the comment period would close on 

December 11, 2023. The FDIC has 

received requests to extend the 

comment period. An extension of the 

comment period will provide additional 

opportunity for the public to consider 

the proposal and prepare comments, 

including to address the questions 

posed by the FDIC. Therefore, the FDIC 

is extending the end of the comment 

period for the proposal from December 

11, 2023, to February 9, 2024. 

Federal Deposit Insurance Corporation. 

Dated at Washington, DC, on November 28, 

2023. 

James P. Sheesley, 

Assistant Executive Secretary. 

[FR Doc. 2023–26510 Filed 12–1–23; 8:45 am] 

BILLING CODE 6714–01–P 


ddrumheller on DSK120RN23PROD with PROPOSALS1